Hong Kong: More moves to facilitate online purchase of life insurance products

| 17 Mar 2022

The Insurance Authority (IA) has announced further measures to facilitate the online distribution of all life insurance products to meet potential policyholders' demand for a wide range of insurance products while minimising the risk of infection during the sales process.

The additional facilitative measures are:

Extension of temporary facilitative measures to 30 September 2022

The temporary facilitative measures (TFM) for non-face-to-face distribution of specific protective insurance products that were rolled out in two phases in February and March 2020 have been extended to 30 September 2022.

No changes were made to the scope of products covered (in-scope TFM products) and the implementation details of the measures. Products include Qualifying Deferred Annuity Policy (QDAP), Voluntary Health Insurance Scheme (VHIS) products, term life policies, and refundable policies without substantial savings component or renewable policies without cash value that provide insurance protection.

Extension of InsurTech sandbox to all life insurance products

To keep up with the expanding needs of the general public for affordable insurance protection and increase financial inclusiveness, the IA will permit the distribution of all life insurance products, including investment-linked assurance scheme (ILAS) products, via the IA-approved virtual onboarding (VO) Sandbox. All other current requirements for the distribution of ILAS products are still applicable and must be complied with as appropriate. This blanket approval covers all insurers currently operating VO Sandbox approved by the IA, and they need not submit new applications to effect this extension.

In addition, all in-scope TFM products can now be sold via VO Sandbox without video or audio recording, provided that upfront disclosure at the point of sale is duly performed and an extended cooling-off period of no less than 30 calendar days is adhered to.

Speedier processing of VO sandbox applications

The IA has set up a fast track to expedite the processing of applications from insurers without VO Sandbox intending to sell life insurance products via video conferencing. These insurers may also consider making use of the shared virtual onboarding platform launched by the Hong Kong Federation of Insurers in September 2020, which has been pre-vetted by the IA to shorten the turnaround time required for the necessary approval.

Ms Carol Hui, executive director of long-term business at the IA, said, “The introduction of further facilitative measures aims to help address the need of potential policyholders in obtaining the necessary protection while minimising the risk of infection when taking out life insurance policies.”

She added that IA will review the facilitative arrangements constantly in view of the evolving pandemic developments.